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Kerik made big gains on stun gun stock Original Source Link: (May no longer be active)
http://www.mercurynews.com/mld/mercurynews/news/world/10384254.htmhttp://www.mercurynews.com/mld/mercurynews/news/world/10384254.htm
Posted on Fri, Dec. 10, 2004
Stun guns have enriched nominee
HOMELAND SECURITY PICK MADE MILLIONS
By Eric Lipton
New York Times
WASHINGTON - Five years ago, Bernard Kerik was facing lawsuits from a condominium association and a bank over delinquent payments owed on a modest New Jersey condo he then owned. Today, he is a multimillionaire, the result of a lucrative partnership with former New York Mayor Rudolph Giuliani and an even more profitable relationship with a stun-gun manufacturer.
If he is confirmed to the post of homeland security secretary for which he was nominated by President Bush last week, he will oversee an enormous department that does business with some of the companies that helped make him wealthy.
The list of income sources that transformed the former New York City police commissioner into a wealthy man is a diverse one, including a bestselling autobiography, speeches around the United States and service on corporate boards. Kerik even sold the rights to make a feature film about his rags-to-riches life to Miramax, the film production company.
But it is the relationship Kerik has had since the spring of 2002 with Taser International, a Scottsdale, Ariz.-based manufacturer of stun guns, that has been by far the biggest source of his newfound wealth, earning him at least $6.2 million in pre-tax profits through stock options he was granted and then sold, mostly in the past month.
Kerik benefited largely because the company has enjoyed an extraordinary surge in its stock. Stock options that were worth very little at the time became extremely valuable, in part because of the sales pitch that Kerik made on the company's behalf to other police departments.
The sales driving Taser's growing profits come mostly from local and state governments. But while Kerik has served on the company's board, it has made an aggressive push to enter markets either regulated or controlled by the federal government, most notably the Department of Homeland Security. A White House official said Kerik would resign from the board and sell his remaining stock if confirmed.
Kerik declined, through an intermediary, to discuss his work for Taser.
In the past, Kerik has defended the stun guns against criticism that their use had contributed to the deaths of suspects who have been fired upon by police. Amnesty International said there have been 74 Taser-related deaths in North America since 2001 and called for a suspension on the use of the device until its safety was further investigated.
An Air Force laboratory that conducted research on the guns said last month that it could not determine if they were safe, in contrast to statements from Taser that the laboratory had found its weapons generally safe and effective.
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